German Fund Enters US Market With Boston Buy

By Gail Kalinoski

Tower Point

A German investment fund has made its first acquisition in the United States, acquiring Tower Point @ A Street, a 157,000-square-foot office and retail property in Boston’s Upper Seaport District, for $86.85 million.

Universal-Investment-Gesellschaft mbH, on behalf of the BVK-US-Value-Immobilienfonds, bought the restored 117-year-old building from Rockpoint Group. The fund was advised by Northwood Investors. It was the Frankfurt-based fund’s first U.S. investment, according to DLA Piper, the global law firm that represented Universal-Investment-Gesellschaft mbH.

The DLA Piper team included Thanos Matthai and Geoff Howell in Boston; John Cusack, Bob LeDuc and Rich Ashley in Chicago and Fred Klein in Washington, D.C. DLA Piper’s Real Estate group represent several prominent German investors who have been actively acquiring U.S. real estate assets. The Real Estate team advises on U.S. real estate and inbound tax law and often works with its counterparts in Germany.

Newmark Knight Frank Capital Markets arranged the sale on behalf of Rockpoint Group, which had bought the property for $62.1 million from The Davis Cos. in October 2015, according to Yardi Matrix data, which also provided the amount of the new transaction.

The NKF Capital Markets Boston team was led by U.S. Head of Capital Markets Robert Griffin, Vice Chairman Edward Maher, Executive Managing Director Matthew Pullen and Director James Tribble, in conjunction with NKF Senior Managing Director Timothy Bianchi. Newmark Knight Frank’s Boston-based debt team oversaw financing for the transaction and NKF has also been retained as the exclusive leasing and management arm for the property.

Tower Point tenants include Rethink Robotics, NPR, Healthways, Zerto and Owner IQ. The property, located within the hot Seaport District and across the Summer Street bridge, is near Innovation Point, General Electric’s future headquarters.

“Tower Point boasts two major benefits –  first, it offers rare brick-and-beam space that directly appeals to ‘next generation’ technology and creative tenants. Second, it enjoys exceptional adjacency to an unmatched concentration of human capital, ideally located between GE’s new global headquarters overlooking Fort Point Channel and State Street’s recently completed build-to-suit complex at Channel Center,” NKF’s Pullen said in a prepared statement.

Built in 1900, the six-story former manufacturing building was converted to office space in 1988 and underwent several cosmetic renovations over the years, according to Yardi Matrix. The Davis Cos., which acquired the property in 2013 for $43.4 million, gave the building a multi-million makeover. NKF noted the rehabilitation included “virtually all-new tenant fit-outs, completed in the past 10 years.”

Occupancy increased from 74 percent when Davis bought the building to 95 when it sold it two years later to Rockpoint Group. Currently, it is fully leased.